Sovereign Wealth Funds

 

State owned investment funds comprised of a country’s reserve capital.

 

Sovereign Wealth Funds often have a higher degree of risk as they often take large ownership stakes and allocate heavily to emerging/developing markets. SWF’s tend to be opportunistic investors during economic decline.

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Major Considerations

  • Focused on larger funds and more established managers

  • Can be highly selective

  • Can make opportunistic investment commitments

  • Can have a long due-diligence process

  • Often like co-investments

  • Can be important anchor or cornerstone investors for regional funds

 

Typical Allocation

 

SWFs have an aggregate alternatives allocation of around 27% of total AUM.

 

HOW DO SOVEREIGN WEALTH FUNDS INVEST?; State Street Global Advisors

Largest SWFs

 

  1. Government Pension Fund Global, Norway; AUM - 1.1T

  2. China Investment Corporation, China; AUM – 950Bn

  3. State Administration of Foreign Exchange, China; AUM - 690Bn

  4. Kuwait Investment Authority, Kuwait; AUM – 592Bn

  5. Abu Dhabi Investment Authority, UAE; AUM – 580Bn

  6. Hong Kong Monetary Agency, Hong Kong; AUM – 531Bn

  7. Saudi Arabian Monetary Agency, Saudi Arabia; AUM – 510Bn

  8. GIC, Singapore; AUM – 510Bn

  9. Qatar Investment Authority, Qatar; AUM – 330Bn

  10. National Social Security Fund, China; AUM - 325Bn

 

PreQin 2020​

Articles of Interest

THE WORLDS BIGGEST SWF CRACKS DOWN ON COAL; Aljazeera

THE LONG TERM STRATEGY OF GULF SOVEREIGN WEALTH FUNDS; Asia Times

GOVTS WORLDWIDE DRAWDOWN ON THEIR SWFs; Trinidad & Tobago Guardian

EXTERNAL MANAGERS DELIVER 4.1BN EXCESS RETURN FOR SWF; CityWire